Not feeling the groove: Revolution Bars has rebuffed a merger proposal from Deltic nightclub group

I cover private equity, asset management and financial regulation for City A.M. You can contact me on lucy.white@cityam.com with stories and commentary.

This is the second proposal Revolution has received in weeks (Source: Getty)

Lucy White

Revolution Bars seems to be having a moment, as nightclub operator Deltic Group this morning proposed a merger with the chain just weeks after Stonegate Pub Company made a move.

At the end of July, Slug & Lettuce owner Stonegate published a possible offer of 200p per share for the Revolution chain, whose share price has plummeted in recent months after it warned it was racking up higher-than-anticipated costs.

But Deltic, which operates clubs under the Pryzm, Bar&Beyond, Steinbeck & Shaw, Atik, and Fiction brands, said that an acquisition at this price would be a “disappointing outcome” for Revolution since this is the price which it floated at in 2015.

“Deltic believes that a combination of its business with Revolution would transform the scalability of the enlarged group,” a statement from the group read this morning.

It added that the “operational issues within Revolution” could be “better addressed through Deltic’s management team taking responsibility for both businesses, creating a powerhouse group in its sector”.

But Revolution was not convinced, responding that it “did not see any merit” in Deltic's proposal and that “a combination of Revolution and Deltic is not in the best interest of shareholders at this time”.

Revolution said it was continuing to engage with Stonegate over its possible offer, which values Revolution at around £100m.

The bar chain's share price was up around four per cent in morning trading.

Privately owned Deltic owns 57 clubs, and was acquired by its current shareholders out of the administration of Luminar in 2011.

The group has until 12 September to either confirm its intention to make an offer for Revolution or withdraw its interest.